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A manager must decide how many machines of a certain type to purchase. Each machine can process 100 customers per day. One machine will result in a fixed cost of $2,200 per day, while two machines will result in a fixed cost of $4,000 per day. Variable costs will be $18 per customer, and revenue will be $45 per customer.
a. Determine the break-even point for each range. (Round your answers to the next whole number.)
One machine
Two machines
b. If estimated demand is 90 to 120 customers per day, how many machines should be purchased? Answer should be one or two machines
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